The U.S. Postal Service must reverse a new policy that banned employees from taking unpaid time off to campaign for political candidates ahead of the 2018 midterm elections, a third-party arbitrator has ruled.

The decision came after postal unions challenged the policy as violating their collective bargaining agreements and First Amendment rights. Postmaster General Megan Brennan announced the changes to leave without pay guidelines last year following an independent investigation that found the agency engaged in “systemic violations” of the Hatch Act that led to an “institutional bias” in favor of certain candidates. That law prohibits federal employees from engaging in certain political activity while on the clock or in an official capacity.

The Office of Special Counsel reported the Hatch Act violations after the USPS inspector general found the agency spent $90,000 on overtime to cover for employees who took time off to campaign in advance of the 2016 election.

“We concluded that the USPS practice of facilitating and directing carrier releases for the union’s political activity and the use of union official leave without pay for such activity resulted in an institutional bias in favor of [the National Association of Letter Carriers'] endorsed political candidates and that this violated the Hatch Act,” said Adam Miles last year. Miles was acting special counsel at the time.

OSC directed USPS to take action to remedy the problem, which led to the new policy that the agency sent to unions in October 2017. NALC, the American Postal Workers Union and the National Postal Mail Handlers Union collectively brought their challenge before the arbitrator. The Postal Service cannot make changes related to wages, hours or working conditions without engaging in negotiations, the unions argued, meaning the Postal Service was in violation of its collective bargaining agreements. USPS countered it was only following OSC’s direction.

The arbitrator ruled OSC’s guidance was non-binding and postal management was still required to bargain over the changes.

“I have found the changes to be inconsistent with the agreement, and as such they cannot be fair, reasonable and equitable,” arbitrator Stephen Goldberg wrote in his decision.

Goldberg directed the Postal Service to rescind its policy changes and to “make whole” any employee who was denied leave without pay to engage in partisan political activity. He declined to set the parameters by which USPS must negotiate with the unions over the issue going forward, however, as the labor groups requested.

“The award protects employees’ right to request LWOP to volunteer through their union to participate in important political activities, like the upcoming November elections,” APWU said in a statement after the ruling. “Postal employees have the legal right to campaign and participate in politics, subject to limits under the federal Hatch Act.”

In the runup to the 2016 election, 97 NALC employees took leave without pay to participate in “get out the vote” activities such as knocking on doors, making phone calls and distributing literature, all in support of the union’s endorsed candidates. That led Sen. Ron Johnson, R-Wis., to make a complaint to OSC.

Paul Hogrogian, president of the National Postal Mail Handlers Union, said Johnson’s “political pressures” pushed USPS to issue the policy changes in the first place.

"Those changes were made unilaterally, and without any bargaining or even consultation with the major postal unions," Hogrogian said. "Arbitrator Goldberg easily found that these unilateral changes violated the national agreement, and ordered that they be rescinded." Hogrogian predicted the unions will begin negotiations over the issue in the coming weeks.

Facility and district managers grant postal workers leave without pay requests based on the needs of both the employee and the Postal Service, as well as potential costs to the agency. In the cases in question, the USPS headquarters labor relations manager of policies and programs flouted the standard procedures by directing local labor relations leaders to allow each of the 97 employees to take leave, according to the inspector general’s report. Headquarters did not coordinate the leave requests with the proper staff to ensure that the employees taking time off would not be disruptive to local operations.

In fact, the IG found local supervisors had originally raised concerns about the operational impact of the employees’ leave, but they were ignored. In some cases, the employees’ supervisors declined the requests before higher-level managers overruled them.

This amounted to “systemic violations” of the Hatch Act, OSC said, as USPS management was tacitly putting its thumb on the scale in favor of NALC’s preferred candidates. The IG had found the employees disproportionately took time off—about 82 percent of the cumulative 2,776 days—in political battleground states in which NALC had issued endorsements. Still, Miles added, OSC did not find any USPS official had helped identify employees to take time off or helped any individual “achieve electoral success.” In addition to various Senate candidates, NALC endorsed Hillary Clinton for president.

Postmaster General Brennan explained to a Senate committee last year that postal management had not intended to create any bias toward any candidate, but was simply trying to keep the unions happy. More than 90 percent of the USPS workforce is covered by a collective bargaining unit, she said, so “it is in our best interest to maintain good relations.”

OSC was careful to note its findings were not meant to dissuade unions or employees from being politically active.

“The postal unions and individual employees and members are permitted, and should be encouraged, to maintain PACs, endorse candidates and enlist union members to support their electoral agenda on their own time,” OSC wrote in its report.